Question

Parsons Corporation purchased 75 percent ownership of Tumble Company on December 31, 20X7, for $210,000. Summarized balance sheet amounts for the companies on December 31, 20X7, prior to the purchase, were as follows:


Required
If consolidated financial statements are prepared, determine the amounts that would be reported as cash and inventory, buildings and equipment (net), and goodwill using the following consolidation alternatives:
a. Proprietary theory.
b. Parent company theory.
c. Entity theory.
d. Current accountingpractice.


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  • CreatedMay 23, 2014
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